Alexander M. Moye and Judy H. Moye - Page 4

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                              2.        Insurance for the Police Dog Training Business                                                                                     
                              Petitioners' police dog training business obtained insurance                                                                                 
                    from the Snellings Walters Insurance Agency of Atlanta, Georgia.                                                                                       
                    On October 24, 1989, Mr. Moye applied for a general liability                                                                                          
                    insurance policy for "Rosewood Kennels and Southern Police Dog                                                                                         
                    Academy".  Snellings Walters Insurance Agency typed an "X" in a                                                                                        
                    box on the application indicating that the insured was a                                                                                               
                    corporation.  The policy period was from September 1, 1989, to                                                                                         
                    September 1, 1990.  Mr. Moye deleted "President" (which had been                                                                                       
                    added to the insurance application by Snellings Walters Insurance                                                                                      
                    Agency) and inserted "Sec/Treas" next to his name.                                                                                                     
                              On October 24, 1989, Mr. Moye applied for Georgia workers'                                                                                   
                    compensation insurance for "Rosewood Kennels and Southern Police                                                                                       
                    Dog Academy, Inc.", effective October 20, 1989.  Mr. Moye deleted                                                                                      
                    "President" (which had been added by Snellings Walters Insurance                                                                                       
                    Agency) and inserted "Sec/Treas" in the section entitled                                                                                               
                    "Corporations, Officers, Sole Proprietors or Partners"; he also                                                                                        
                    wrote "Sec/Treas." under his signature on the application.                                                                                             
                              On November 27, 1989, the Snellings Walters Insurance Agency                                                                                 
                    addressed a letter to Mr. Moye at "Rosewood Kennels & Southern                                                                                         
                    Police Dog Academy, Inc."  The Agency asked him to sign a Georgia                                                                                      
                    Form WC 8.  Form WC 8 states that its use is required if a                                                                                             
                    corporate officer desires to decline workers' compensation                                                                                             
                    coverage from the State Board of Workers' Compensation.  It                                                                                            
                    provided in part:                                                                                                                                      



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